Terminal Illness Benefit in Term Insurance

The terminal illness diagnosis can have a devastating impact on a person and his/her family. Regular hospital visits, doctor treatments, surgeries, medications, and other related expenses can have a toll on his/her finances in such cases. One should never neglect the abnormality signs in his/her health related to terminal illness.

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With a good lifestyle and other precautions to avoid health-related issues, one should also buy terminal illness benefits in term insurance. These benefits help to secure our life while protecting our family financially. 

What is Terminal Illness Benefit? 

Terminal illness benefit is an insurance rider that is defined as an attachment to an existing term insurance plan that provides coverage in addition to the policy. Riders are mainly designed to enhance coverage by paying an additional premium. Terminal illness benefit provides you a tax-free lump sum amount in case of the diagnosis of a terminal illness. In case you are diagnosed with a terminal illness, you will be provided a guaranteed amount which, in the future can be used for any expenses. As we already know, the medical treatment for a terminal illness is expensive, but the payout from the terminal illness benefit rider can be used to meet high expenses. 

Why is Terminal Illness Benefit in Term Insurance Important? 

When an individual is diagnosed with any illness or disease, medical coverage is the first thing that comes into their mind. Unexpected medical emergencies can hit the financial status of a person. In case he/she does not have enough savings or insurance coverage, the medical treatment of terminal illnesses might hit his/her pocket and one can lose all his/her hard-earned savings. 

The medical treatment cost of terminal illnesses such as heart and liver diseases is unusually high. A small amount of medication or injection in different kinds of cancer requires a lot of money, and for a successful treatment, various doses are required. 

The expense for treatment of terminal illness may require lakhs of money. Generally, the medical policies pay for hospitalization expenses, but not for the expenses incurred on medicines. So, it becomes essential for people to look at other possible ways to get insured other than a health insurance plan. 

Buying a terminal illness benefit in a term insurance plan can be a smart decision that takes care of your complete medical expenses, along with offering mortality benefits. 

Benefits of Buying Terminal Illness Benefit in Term Insurance Plan 

Term insurance plans are mainly purchased for persons who are fit and do not have any previous health issues. However, if you know that you have previously suffered from a terminal illness, then buying a term insurance plan may be a little bit complex. Various insurance companies these days hold strict T&Cs for term life insurance for individuals suffering from terminal illnesses. 

People go for a health insurance policy that assists them at the time of any type of medical emergency. Still, health insurance has not proved to be that successful in several situations. After going through all these points, people having a term insurance plan have an option to add terminal illness coverage. 

This terminal illness cover with a term insurance plan not only protects your family in case of unfortunate death of the life assured but in future protects them with all medical emergencies arising suddenly. 

If you are planning to buy a term insurance plan along with terminal illness, always ensure that the term insurance plan you select provides you with a greater number of benefits. Here are four benefits of buying cover of terminal illness with a term insurance plan: 

  1. Acts as an Income Replacement 

    Terminal illness benefits taken along with the term insurance plan offer various advantages such as it protects you against any uncertain event and also covers the routine medical test payments and the medical expenses. Some of the term insurance plans also offer an option of ROP i.e., Return of Premium. If in case you outlive the plan, you will get all the premium amounts that you have paid throughout the policy tenure at the time of maturity. 

  2. Protects Against Life-Threatening Medical Situations 

    If you have a term insurance plan without any terminal illness benefit, then your loved ones are not eligible to receive a claim in case of unfortunate death. This cover protects you and your family with a financial cushion during medical emergencies or income loss that arises in case of policyholder’s demise or ill health. 

  3. Double Tax Benefits 

    Terminal illness benefit in term insurance plan provides you dual tax benefits. The premiums paid for these terminal illness coverages and a term plan are exempted in both U/S 80C and 80D of the Income Tax Act, 1961. 

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  4. Guarantee of Higher sum with Low Premium Rates 

    Unlike, conventional medical policies that provide different premium prices after different terms, a term insurance plan with terminal illness benefit has a high amount of coverage at the most cost-effective premium rates. This is due to fact that the medical expenses of terminal illness are approximate Rs.20 Lakhs. Moreover, the number of life assured individuals is practically more limited as contrasted to that of normal illnesses included by a medical insurance plan. It is always a good idea to buy terminal illness cover with a term insurance plan. 

Wrapping It Up!

Terminal illness benefit in term insurance plan is beneficial as these plans help you and your loved ones against life uncertainties. If you are thinking to buy term insurance with terminal illness benefits, choose a plan that best suits your requirements. These rider plans offer comprehensive coverage to ensure that you should always remain safeguarded against critical times.

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